President Donald Trump has delayed planned 50% tariffs on some Canadian goods for three days. The move gives Washington and Ottawa more time to complete an emerging trade agreement.
The tariffs were due to take effect early Wednesday. They would have affected about $20 billion worth of Canadian exports to the United States.
Products facing the higher tariff included wine, dairy goods, cement and hockey equipment. However, major Canadian exports such as energy, potash and critical minerals were excluded.
Trump announces last-minute tariff pause
Trump announced the temporary delay on Truth Social. He said the United States and Canada had reached an agreement, although officials still needed to complete the final paperwork.
Canadian Prime Minister Mark Carney was more cautious. He said both sides had made substantial progress in the negotiations. However, he also stressed that more work was needed before a broader deal could be finalized.
The announcement followed weeks of trade negotiations between the two countries. Trump and Carney have also held direct talks as both governments try to prevent another escalation in the dispute.
Trade barriers remain a key issue
U.S. officials have criticized several Canadian trade policies. In particular, Washington has raised concerns about barriers affecting American dairy products, automobiles and alcohol.
Restrictions on U.S. liquor in some Canadian provinces have also become part of the wider trade dispute.
Meanwhile, the Office of the U.S. Trade Representative said the proposed agreement could address several major issues. These include market access for American goods, economic security and digital trade.
Canada has also agreed to address some policies that Washington considers discriminatory. However, neither government has released the full details of a final agreement.
Canadian industries face pressure
The tariff dispute has already affected several Canadian industries. U.S. duties on autos, steel, aluminum and lumber have increased pressure on businesses that depend heavily on cross-border trade.
As a result, another major tariff increase could have caused further uncertainty for Canadian companies and workers.
Trump also raised the possibility of reviving the Keystone XL pipeline in his announcement. The project was designed to transport Canadian crude oil to the United States. However, it remains unclear whether the pipeline is part of the current trade talks.
For now, the three-day delay prevents an immediate escalation. Still, both governments face a tight deadline to turn the reported progress into a final agreement before the tariff pause expires.
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